Stephen E. Hessler

STEPHEN HESSLER is the leader of Sidley’s global Restructuring group and a member of the firm’s Executive Committee. In his more than two decades of experience, he has represented debtors, creditors, and investors in large and complex Chapter 11 cases, out-of-court restructurings, asset acquisitions, and related litigation. Steve has counseled clients across a broad range of industries, including telecommunications, travel, energy, gaming, real estate, financial institutions, and manufacturing. He led the company-side representation of some of the most significant Chapter 11 reorganizations in recent history, including Frontier Communications and Windstream Holdings, and represented the purchasers of Hertz Global Holdings in their Chapter 11 cases.

Steve has consistently been recognized as a leading Bankruptcy/Restructuring lawyer by Chambers USA (2015–2025), with sources in the 2022 edition noting he is an “excellent corporate bankruptcy counsel, and a brilliant strategist and tactician.” Sidley’s Restructuring group is also regularly ranked as a leading practice in Chambers Global, Chambers USA, and Chambers UK (2012–2022). The group was shortlisted for 2023 Bankruptcy “Law Firm of the Year” by Chambers USA.

Steve is a frequent lecturer and author on various restructuring-related topics. He co-teaches Corporate Governance: Board and Director Roles in Critical Decisions at the University of Chicago Booth School of Business. For nearly a decade, Steve co-taught a restructuring class at the University of Pennsylvania, most recently as an Adjunct Full Professor of Finance at the Wharton School, and received the Wharton Teaching Excellence Award in 2019, 2020, and 2021. He also co-founded the University of Pennsylvania Institute for Restructuring Studies, a multidisciplinary initiative intended to address topical restructuring issues and influence the public policy debate in a manner that has practical application for investors, practitioners, academics, and regulators.

In 2023 and 2018, Steve testified before the Senate Judiciary Committee, and in 2017, 2015, and 2014 he testified before the House Judiciary Committee, on various amendments to reform the Bankruptcy Code. He also has published multiple articles in legal and mainstream publications, and organized or participated in multiple seminars, on these topics.

He is the founder and chair of Leadership in Financial Education, a nonprofit that provides innovative and experiential workshop learning to New York City high school students. Steve is also currently a director, and for almost 15 years was the board chair, of Futures and Options, Inc., a 501(c)(3) organization that places students from New York City high schools in paid and mentored internships at private sector and nonprofit firms. He is the former chair of the Advisory Board on Administrative Claims, Critical Vendors, and Other Pressures on Liquidity for the American Bankruptcy Institute’s Commission to Study the Reform of Chapter 11 (2012–2015).

Steve’s experience at Sidley includes representing:

• Merit Street Media, Inc., a Texas-based television and digital media company, in its Chapter 11 filing in the United States Bankruptcy Court for the Northern District of Texas, and in the successful negotiation of US$21.4 million in debtor-in-possession financing.
• Casa Systems, Inc., and certain of its affiliates, in their Chapter 11 proceedings in the U.S. Bankruptcy Court for the District of Delaware.
• Casa Systems, Inc. in connection with a transaction support agreement and ultimately obtaining a new super-priority term loan B facility and related transactions to facilitate the extension of the maturity date of approximately 98% of Casa’s existing term loan B originally due in December 2023.
  
• AppHarvest, Inc. and its subsidiaries in their pending Chapter 11 bankruptcy cases in the U.S. Bankruptcy Court for the Southern District of Texas. AppHarvest is a high-tech indoor farming company with over US$300 million in funded debt and lease obligations. The Company’s Chapter 11 plan is currently supported by a restructuring support agreement with its largest secured creditor (Equilibrium Capital) and a key distribution partner. The RSA contemplates an approximately 60-day sale process under section 363 of the Bankruptcy Code, whereunder the Company expects to transition AppHarvest’s existing operations to Equilibrium, the Company’s proposed stalking horse purchaser, or any alternative purchaser, subsequent to the ongoing marketing and sale process.
• Reverse Mortgage Investment Trust Inc. and certain of its subsidiaries (RMIT) in their Chapter 11 bankruptcy cases in the U.S. Bankruptcy Court for the District of Delaware. RMIT was a leading fully integrated financing company that focused on the reverse mortgage industry, with a servicing portfolio of approximately US$25.57 billion as of October 31, 2022. With over US$1.4 billion in funded debt obligations, RMIT’s Chapter 11 cases were among the largest filed in 2022. As part of the transactions approved by the Bankruptcy Court, the Company’s sponsor and the official committee of unsecured creditors agreed to an innovative settlement whereby in exchange for an additional US$15 million in debtor-in-possession financing and the waiver of recovery as to certain claims, the sponsor and the Company’s directors and officers received broad mutual releases from the estate. Two months later, the Company’s fully consensual Chapter 11 plan was confirmed, and RMIT emerged from Chapter 11 one day later.
• An ad hoc group of first-lien noteholders holding over US$1 billion of notes in the financing and restructuring of Ligado.
• American Entertainment Properties Corp. (AEP), an Icahn Enterprises, L.P. subsidiary in the Chapter 11 cases of AEP’s affiliate, Auto Plus, which included a DIP financing with a significant roll-up, and a mediated settlement with broad releases. Following mediation, secured a global settlement between AEP, the debtors, and the UCC that resolved numerous claims against various insiders of the debtors, including AEP, in its capacities as prepetition and debtor-in-possession lender to Auto Plus, Pep Boys and other Icahn-owned entities. The settlement was approved ahead of a Chapter 11 plan and in connection with the final DIP financing hearing early in the Chapter 11 case. The settlement allowed AEP’s prepetition debt of US$190 million to be “rolled up” into the AEP funded DIP loan of up to US$75 million in new money (with only US$17 million drawn), as well as granting AEP an unfettered right to “credit bid” its DIP and prepetition debt amounts. The DIP financing and the settlement created a path for the confirmation of a Chapter 11 plan in Auto Plus’ Chapter 11 cases.
• Cantor Fitzgerald in the restructuring of approximately US$360 million of indebtedness of View, Inc. in Chapter 11.
• The special committee of the board of directors of Comtech Telecommunications Corp. in the convertible preferred equity investment by White Hat Capital Partners LP and funds affiliated with Magnetar.
• A luxury home furnishing company in connection with its US$30 million out-of-court debt restructuring.

Prior to joining Sidley, Steve’s experience includes representing:

Telecommunications Restructurings

• Frontier Communications Corporation and its 103 debtor subsidiaries in their prearranged Chapter 11 restructuring in the U.S. Bankruptcy Court for the Southern District of New York. With over US$17.5 billion in outstanding funded debt, Frontier’s Chapter 11 cases were among the largest filed in 2020. Frontier, together with its subsidiaries, has over 4 million customers, and 18,000 employees across 29 states. The company’s prearranged plan, which was confirmed in approximately four months, effected a balance sheet restructuring that reduced the company’s outstanding funded debt by over US$10 billion, carried broad stakeholder support, and proposed unimpairment of all general unsecured creditors.
• Windstream Holdings, Inc., and its debtor subsidiaries in their Chapter 11 restructuring in the U.S. Bankruptcy Court for the Southern District of New York. Windstream is a leading provider of advanced network communications, technology, broadband, entertainment, and security solutions to consumers and small businesses in 18 states. In bankruptcy, Windstream commenced litigation to recharacterize a US$3.5 billion spinoff and master lease of certain telecommunications network assets. That litigation resulted in an innovative settlement that provided over approximately US$1.2 billion in net present value and billions of dollars of improvement to Windstream’s telecommunications infrastructure. Windstream also confirmed a Chapter 11 plan of reorganization that addressed more than US$5.6 billion in funded debt obligations, provided for a US$750 million equity rights offering, and positioned Windstream to achieve its long-term goals.
• One of the largest cable operators in the United States and its affiliated debtors in their Chapter 11 cases. One of the largest prearranged cases in history, the subsequent restructuring plan reduced approximately US$8 billion of the Debtors’ over US$20 billion in debt.
• Sizmek Inc. and its affiliates, a leading online advertising campaign management and distribution platform for advertisers, media agencies, and publishers, in its out-of-court, balance-sheet restructuring of more than US$150 million of funded indebtedness.
• A steering and an ad hoc committee of noteholders of Intelsat, one of the world’s largest and industry-leading satellite services businesses, including with respect to potential debt exchanges in connection with the proposed merger with OneWeb, as well as various debt restructurings of over US$1 billion of notes.
• Clearwire Corporation and its affiliates in connection with their successful out-of-court refinancing efforts.
• An ad hoc committee of senior secured noteholders in the Chapter 11 cases of TerreStar Networks.

Energy Restructurings

• Whiting Petroleum Corporation and certain of its affiliates (collectively, Whiting) in connection with Whiting’s prearranged Chapter 11 cases in the U.S. Bankruptcy Court for the Southern District of Texas. Whiting is a Denver-based publicly traded independent exploration and production company with an oil-focused asset base, employing approximately 500 employees and with funded debt of approximately US$3.4 billion at the time of the Chapter 11 filing. Whiting entered into a restructuring support agreement with its unsecured noteholders, which contemplated a Chapter 11 plan that would provide 97% of the reorganized equity to noteholders and other holders of general unsecured claims, while still providing a recovery to existing equity holders in the form of the remaining 3% of reorganized equity. Through the deal reached with Whiting’s lenders and noteholders, Whiting delivered its balance sheet by eliminating over US$2.7 billion of funded debt.
• Blackhawk Mining LLC and its affiliates in their prepackaged Chapter 11 cases in the United States Bankruptcy Court for the District of Delaware. Blackhawk is a leading metallurgical coal producer based in Lexington, Kentucky, and has operations primarily in West Virginia and Kentucky. Blackhawk employs more than 2,800 employees. Blackhawk entered Chapter 11 to implement a prepackaged plan of reorganization that will eliminate approximately US$650 million of the Company’s nearly US$1.1 billion in prepetition funded debt.
• Mission Coal Company, LLC, and its affiliates in their Chapter 11 cases in the United States Bankruptcy Court for the Northern District of Alabama. The company was headquartered in Kingsport, Tennessee, with coal mining operations in West Virginia and Alabama. Mission Coal entered Chapter 11 to complete a sale process and, after an auction, received winning bids for three of its metallurgical coal mines. The company also successfully obtained court approval to modify its collective bargaining agreements through sections 1113 and 1114. After a highly contested plan and sale process, Mission Coal obtained the support of its DIP Lenders and reached a settlement with the unsecured creditors committee, and as a result, in May 2019 the Court simultaneously approved the sales and confirmed the plan.
• Westmoreland Coal Company and certain of its affiliates (collectively, Westmoreland) in their Chapter 11 proceedings before the U.S. Bankruptcy Court for the Southern District of Texas. Westmoreland is the sixth-largest North American coal producer, maintaining domestic coal operations in Montana, Wyoming, North Dakota, Texas, New Mexico, and Ohio, and Canadian coal operations in Alberta and Saskatchewan, and is headquartered in Englewood, Colorado. At the time the cases were filed, Westmoreland had funded debt obligations of approximately US$1.4 billion. Westmoreland pursued a sale of its mining operations and commenced its Chapter 11 cases with a restructuring support agreement entered into with a substantial majority of its key lender constituents.
• Linn Energy, LLC, and its affiliates ꟷ including Berry Petroleum Company, LLC ꟷ in its Chapter 11 cases filed in the United States Bankruptcy Court for the Southern District of Texas. Linn is a leading independent oil and natural gas exploration and production company with operations in 12 states and eight discrete U.S. regions. As part of the restructuring, Linn and Berry were split into two separate, unaffiliated companies. Aided by two backstopped rights offerings, Linn reduced its debt by US$6.1 billion and Berry reduced its debt by US$1.2 billion.
• Represented an ad hoc committee of senior secured lenders to CGG S.A. and its subsidiaries in connection with a prearranged restructuring through concurrent French sauvegarde, Chapter 15, and Chapter 11 proceedings. CGG is based in France and globally operates a geoscience services and equipment company supporting commercial oil and gas exploration and production. CGG’s prearranged restructuring addressed its over US$2 billion in funded debt obligations, including three tranches of secured loans across its capital structure.
• An ad hoc committee of second lien noteholders of Alpha Natural Resources, Inc., one of the largest coal producers in the United States, in its Chapter 11 restructuring, which addressed approximately US$4.2 billion in funded debt obligations and other legacy liabilities.
• An ad hoc committee of unsecured noteholders of Peabody Energy Corporation, the world’s largest publicly traded, private-sector coal company, in its Chapter 11 cases, which addressed approximately US$8.8 billion in funded debt obligations and other legacy liabilities. The ad hoc committee members collectively held approximately US$2.0 billion of unsecured note claims, and certain of the members were lenders within the debtors’ DIP facility.
• A group of unsecured noteholders of Arch Coal, Inc., one of the world’s top coal producers for the global steel and power generation industries.
• W&T Offshore, Inc., in evaluating strategic alternatives related to the company’s capital structure. W&T is an independent oil and natural gas producer with operations offshore in the Gulf of Mexico and working interests in approximately 54 offshore fields in federal and state waters.
• Patriot Coal Corporation and certain of its affiliates, producers, and marketers of coal in the eastern United States with several active mining complexes in West Virginia, in their Chapter 11 proceedings before the United States Bankruptcy Court for the Eastern District of Virginia. At the time of filing, Patriot and its affiliates had funded debt of approximately US$790 million as well as significant and complex legacy and environmental liabilities.
• In connection with Patriot’s first Chapter 11 filing in 2012–2013, represented an ad hoc group of investors that fully backstopped approximately US$250 million in rights offerings for second lien priority senior secured notes and warrants exercisable for approximately 95% of the company’s new equity, effectuated through the Chapter 11 plan of reorganization. As a result of the rights offerings, the ad hoc group of investors acquired a majority of reorganized Patriot’s second lien priority senior secured notes and warrants.
• Calpine Corporation and its affiliates (collectively, Calpine). Calpine was an independent power producer and marketer that operated more than 90 power plants in North America and was the world’s largest producer of renewable geothermal energy. Calpine’s Chapter 11 cases, with more than US$17 billion in debt and 270 debtors, were the sixth largest in history at the time of filing.
• Energy Future Holdings Corp. and 70 of its affiliates (collectively, EFH) in their prearranged Chapter 11 cases in the U.S. Bankruptcy Court for the District of Delaware. EFH — the largest generator, distributor, and certified retail provider of electricity in Texas — is the product of the largest buyout in history. With over US$49 billion in liabilities and US$36 billion in assets, EFH’s Chapter 11 case is the largest operating Chapter 11 case ever filed in Delaware and the seventh-largest Chapter 11 case filed in history.
• Highbridge Principal Strategies, LLC, as senior secured lender in the Chapter 11 cases of RAAM Global Energy Company (RAAM) in the United States Bankruptcy Court for the Southern District of Texas. RAAM is an independent oil and natural gas exploration and production company with producing assets located offshore in the Gulf of Mexico and onshore in Louisiana, Texas, Oklahoma, and California. RAAM’s Chapter 11 restructuring addressed its over US$300 million in funded debt obligations and other liabilities.

Gaming, Hospitality, and Real Estate Restructurings

• Knighthead Capital Management, LLC and Certares Opportunities LLC in their successful US$5.916 billion purchase of Hertz, one of the largest car rental companies in the world, out of its Chapter 11 cases, following a multi-month competitive auction. The transaction resulted in a recovery to existing equityholders of more than US$8.00 per share, payment in full to all creditors, and an implied plan enterprise value of US$6.929 billion.
• The Majestic Star Casino and its affiliates, which operate gaming facilities in Indiana, Mississippi, and Colorado, in their Chapter 11 cases. Majestic consummated a plan of reorganization supported by each of its major stakeholders that reduced the company’s funded indebtedness by nearly 78% (from US$735 million to US$160 million), safeguarded the continued employment of the company’s 2,600 employees, and protected the vital revenue stream provided by the company’s tax payments to multiple jurisdictions.
• UTGR, Inc., d/b/a Twin River, and certain of its affiliates in their Chapter 11 cases. Twin River, a casino, is the third-largest source of tax revenue for the state of Rhode Island. Pursuant to a prepetition agreement among the debtors, a majority of their senior secured lenders, and the Rhode Island executive branch, the Chapter 11 cases eliminated approximately US$290 million of the debtors’ approximately US$600 million of debt obligations and obtained significant state legislative and regulatory support for the facility.
• Innkeepers USA Trust in its Chapter 11 reorganization involving approximately US$1.6 billion of indebtedness.

Financial Institution Restructurings

• An education loan management and business processing solutions company in securing dismissal of an involuntary Chapter 11 bankruptcy proceeding filed in the Bankruptcy Court for the Southern District of New York. The Bankruptcy Court dismissed the involuntary case just two weeks after it commenced.
• Ally Financial Inc. (AFI), Ally Bank, and their subsidiaries, in connection with the Chapter 11 cases of Residential Capital LLC, AFI’s mortgage subsidiary.

Manufacturing Restructurings

• Leiner Health Products, Inc., a leading United States manufacturer of store brand vitamins, minerals, and nutritional supplements, and its affiliates in their Chapter 11 cases that involved approximately US$500 million of debt obligations, a negotiated resolution of a federal criminal investigation, and a highly successful sale of substantially all of the debtors’ assets.
• Collins & Aikman Corporation, a global automotive interiors manufacturer with nearly US$4 billion in annual sales, approximately 23,000 employees, and approximately US$3 billion in funded debt, and its affiliates in their Chapter 11 cases.

Testimony

• Witness, Hearing on “Evading Accountability: Corporate Manipulation of Chapter 11 Bankruptcy,” United States Senate Committee on the Judiciary, September 19, 2023.
• Witness, Hearing on “Big Bank Bankruptcy: 10 Years After Lehman Brothers,” United States Senate Committee on the Judiciary, November 13, 2018.
• Witness, Hearing on H.R. 1667, “The Financial Institution Bankruptcy Act of 2017,” United States House of Representatives Committee on the Judiciary, Subcommittee on Regulatory Reform, Commercial and Antitrust Law, March 23, 2017.
• Witness, Hearing on H.R. 2947, “The Financial Institution Bankruptcy Act of 2015,” United States House of Representatives Committee on the Judiciary, Subcommittee on Regulatory Reform, Commercial and Antitrust Law, July 9, 2015.
• Witness, Hearing on H.R. 5421, “The Financial Institution Bankruptcy Act of 2014,” United States House of Representatives Committee on the Judiciary, Subcommittee on Regulatory Reform, Commercial and Antitrust Law, July 15, 2014.

• Chair and Founding Member, Leadership in Financial Education, a 501(c)(3) organization offering financial education training through innovative and experiential workshop learning to high school-aged students within New York City
• Director and Former Chair of the Board of Directors, Futures and Options, Inc., a 501(c)(3) organization that places students from New York City high schools in paid and mentored internships at private sector and nonprofit firms
• Member, Business Bankruptcy Advisory Committee of the United States Bankruptcy Court for the Southern District of New York 
• Former Member, Local Bankruptcy Rules Committee for the Southern District of New York
• Member, International Insolvency Institute
• Co-Founder, University of Pennsylvania Institute for Restructuring Studies